Picture this: a large, multibillion dollar Canadian corporation comes to the president of the United States and wants to build a 1,700-mile oil pipeline from Canada all the way to the Gulf of Mexico. After reviewing the project, it becomes clear that instead of reducing America's reliance on oil from overseas, this pipeline would carry oil across America, risking spills on our land and waters, just to export the oil to other countries. In addition, the pipeline would increase gasoline prices in America, add to our air pollution, and most importantly, be a major setback in the fight to reverse global warming.
Clearly, the president would say no to Big Oil on this one, wouldn't he?
This is the exact question facing President Obama as he reviews TransCanada's proposed Keystone XL tar sands oil pipeline. Keystone XL could carry up to 900,000 barrels of dirty tar sands oil across America every day. Producing and refining tar sands oil is energy-intensive, and releases 82% more greenhouse gas emissions, as well as more poisonous mercury and arsenic, compared to conventional oil. Piping corrosive tar sands oil is risky, and Keystone XL would run over an aquifer that provides drinking water for millions of Americans.
Perhaps the Keystone XL decision has not been clear-cut for the Obama administration since the State Department, the agency in charge of the pipeline review, selected a contractor hand-picked by TransCanada to conduct environmental reviews. Cardno Entrix, the contractor selected, had financial ties to TransCanada and lists TransCanada as a "major client".
Unsurprisingly, Cardno Entrix's sugar-coated analyses of environmental risks are open to serious questions. Their report said a Keystone XL spill would "not require unique clean up procedures". Really? What about the tar sands spill into the Kalamazoo River, which closed sections of the river for more than a year, with a cleanup tab that has ballooned to $700m? The Environmental Protection Agency stated it had never seen a river so affected by so much submerged oil.
State Department officials tout the energy security benefits of Keystone XL, but TransCanada itself admits that by removing an oil oversupply in the Midwest, the pipeline would result in "an increase in the price of heavy crude" that should net Canadian oil producers a $1.9bn increase in revenue at the expense of American consumers. Gulf Coast refiners, which would receive tar sands oil from Keystone XL, have detailed a strategy to their investors to export the oil out of the United States.
In what I see as a positive sign, President Obama says he will decide the fate of Keystone XL personally. Unfortunately, the State Department is providing him with deeply flawed analysis. That is why I asked the State Department inspector general to investigate the conflicts of interest allegations. I appreciate that in response to the request I made, along with 14 other members of Congress, the inspector general agreed to conduct a special review of the State Department's handling of the Keystone XL proposal.
In my view, the evidence is overwhelming that this pipeline is not in the best interest of our environment or the economic interest of the American people, and the president should reject it. At the very least, he should put off a final decision on this project until the special review is complete and the results are made public.
In terms of energy policy, we have better options. Adopting President Obama's plan to move to 54.5 miles per gallon by 2025 will save approximately 2.5m barrels of oil per day by 2030, which is more oil than we would import from Keystone XL, the Middle East and the Persian Gulf combined. Instead of raising gas prices on Americans, as Keystone XL would do, these fuel standards would save drivers $7,000 over the life of a vehicle.
President Obama should say yes to stronger fuel economy standards, and no to Keystone XL. By doing so, he will keep faith with his campaign promises to break our oil addiction and reverse global warming.
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